A Bloomberg report released early this afternoon says ExxonMobil’s chief executive told reporters earlier today that plans to build a natural gas pipeline from the Mackenzie Delta in Canada’s Arctic may be shelved after cost projections more than doubled.
“At those costs, it’s not viable to build that pipeline,” Exxon CEO Rex Tillerson said after the Irving, Texas-based company held its annual shareholders meeting in Dallas. “It may just be that this project will have to wait for a different cost environment.”
Tillerson also told reporters that soaring costs may also make the proposed gas pipeline from Alaska’s north too expensive to pursue: “My expectation is if we went back and looked at the costs again, they would have gone up dramatically,” Tillerson said. “It involves lots of steel, lots of compressors, lots of valves, all the same things you need for the Canadian project.”
Editor’s note: See full story in the June 3 issue of Petroleum News, which will be released online this coming Friday at noon Alaska-time.